Hedge fund Ore Hill limits redemptions
| Reuters
Hedge fund Ore Hill Partners, a $3 billion credit specialist, has barred clients from getting their money back, imposing a halt on redemptions just as investors clamored for an exit, the company said on Friday.
President Signs Landmark No Bank Left Behind Bill
Floor of NYSE
New York, New York
9:50 A.M. EST
THE PRESIDENT: Thank you all very much.
AUDIENCE: U-S-A! U-S-A!
THE PRESIDENT: Okay. I know you all are anxious to get back to making money. (Laughter.) So please be seated. (Laughter.) Thank you for such a warm welcome. It's great to be in the Big Apple. (Applause.)
We've got large challenges here in America. There's no greater challenge than to make sure that every bank -- and all of us on this stage mean every bank, not just a few savings & loans -- (applause) -- every single bank, regardless of where they are located, whether an investment bank or mortgage lender, the capitalization level of the bank, every financial institution receives first-class financial aid from America. (Applause.)
And as you know, we've got another challenge, and that's to protect America from evil short-sellers. And I want to assure the executives and managers at our nations financial institutions that the effort that this great country is engaged in, the effort to defend share prices and to defend bonuses, the effort to rout out downward stock prices wherever they exists, is noble and just and right, and your great SEC will prevail in this effort. (Applause.)
I long for the dollar to appreciate. But I also understand that if we do not lead the world against bank failures, that your children and your grandchildren will not grow up in a financial system as free of lending standards as the one we have today. Inflation is a precious gift that one generation can pass to the next. It is a gift and a promise that I intend to keep to the American children. (Applause.)
And we owe the children of America lots of free money. And today begins a new era, a new time in public education in our country. As of this hour, America's banks will be on a new path of reform, and a new path of results.
Our banks will have higher expectations. We believe every bank can learn. Our banks will have greater resources to help meet those goals, thanks to the Federal Reserve. Investors will have less information about the banks, and less visibility into how their banks are capitalized. From this day forward, all banks and their executives will have a better chance to learn, to excel, and to live out their dreams of being bailed out by the taxpayer! (Applause.)
Thank you for letting us come. May God bless. (Applause.)
National City will make the BFF list soon enough but 2 weeks is enough to get together the resources for a real bank like Downey. Newport Beach is much more pleasant than Cleveland.
On page A15 of the LA Times, well the San Diego version at least, there's an advertisement of a bank offering a 7 month CD at 4.15%. The ad features one word in bold:
COMMITMENT
The institution offering this CD? Indymac Federal Bank.
In case anyone is concerned, the ad mentions that "Deposits Insured by the FDIC." I think they want your business back, Dawg.
ah yes Mr. Lovell....have had many dinner's with current and former astronauts (a perk in my capacity in a previous life) and out of all of them there are two that stand out as fine examples of true patriots (not the current definition mind you). One of them was Wally Schirra (many great stories and a shear joy to visit with-he lent me his 400i for a few hours once)and the other was Jim Lovell.
The common thread between these two is that they never drank alcohol in public. The rest of them, in comparison to these two, were just like everyone else excepting their unique experiences with regards to careers. And almost everyone single one of them I've seen drunker than skunks.
Those two would have made quite a political team IMO.
We can also find comfort that the kids
will start 10-trillion in the hole,
which will keep them humble, working
at something, and free from decadent leisure.
.
From today's SF Chronicle columnist Leah Garchik...
Nelle Engoron found a Craigslist entry noting that the Contra Costa County Employment and Human Services Department is looking for an "organization to provide financial literacy training for laid-off individuals. ... The selected contractor(s) shall guide and support laid-off mortgage industry individuals in becoming financially literate." Laid-off workers are to be instructed on "techniques that will help them analyze their current financial situation, create a financial plan and downsize their debt."
Huh? Weren't "mortgage industry individuals" supposed to be financially literate when they were doing their jobs? Perhaps, suggests Engoron, "this helps explain how the mortgage meltdown happened."
It's sad, banks are only offering a bit more than their normal pittance when forced to bulk up their balance sheets. And we scramble to pick up their crumbs.
"I seem to remember the last few announcements being made around 5pm PST...anyone recall?"
It has depended on the bank's footprint. The announcement was out shortly after 6PM EDT for First Priority (no branches west of eastern time). IMB didn't get the call until after closing time on the west coast. So, if you're hoping for a big carcass to wash up today, get a comfy chair, crack open a beer (or 3), and plan on getting comfortable until about 6 PM PDT.
Literally? Like they had flooded? Where did all this water come from?
Her name is Fay. Orlando had to close down two water parks, because "people lose interest during inclement weather," wrote The Orlando Sentinel business section. This is one of the worst papers in the U.S.
What do you guys think is going to happen with LEH, WM and WB?
They all seem to be right on the edge from the rumors. Will one or two be handed over to JPM or will FDIC take them over?
Has anyone heard any more details on the 90 banks on the troubled list? I know they haven't said who is on the list, but any hints to the size or anything else on them?
After that joke I recommend that you keep low for the next few days, check around when walking outside at night and make sure no-ones tampered with your brakes or engine.
query_tool...I bought WFC XIV preffereds with a 8.65% yield a few days ago. They are going to survive this thing so I might as well put my long term cash to work.
If you believe that then I suggest you make sure to hold on tight to that bar of soap when you're in the bathroom. DON'T drop it, and if you do, DO NOT bend over to pick it up.
I'd guess that somethings as messy as a WaMu, Wachovia, or even a DSl would require extra time and extra pizza. Labor Day weekend is coming, but not today...
Downey is PST as well. Fortunately by then I'll already be dining at the Hollywood Bowl. Tonight's concert is strange, Donna Summer. Seems like everything I'm doing these days involves revisiting the past. Anybody got any "W.I.N." buttons?
Given what we know about the current Admin (case in point: latest Medicare fraud claims mendacity), there must be strong internal incentives to push as much of this past November as possible.
So I keep wondering, baring an outright run on a bank, how long CAN an FDIC takeover be put off. FFDIC?
"Given what we know about the current Admin (case in point: latest Medicare fraud claims mendacity), there must be strong internal incentives to push as much of this past November as possible."
Quite true. And maybe they're thinking that there's a REALLY conveniently placed 4-day weekend toward the end of November. Granted, Thanksgiving Friday is neither a bank nor a trading holiday, but someone has to give Domino's something to do that weekend, right? And most of America will be too busy recovering from tryptophan comas and participating in the annual orgy of mall-ness to notice.
"Do you think the astronauts drinking problems are as a result of being on top of an extremely explosive device built by the low bidder?"
Absolutely......although no one knew more about the Atlas rocket than Wally. That includes every single person responsible for design, mfg.,maintenance, safety (oxymoron in those days)
But I also (as he told me later in his life) realize that it was only a few times and you can't spend your life compensating for an event that you did survive. He was speaking about one of his former colleagues....his initials were A.S. since I'm not wanting to name actual names and all......
And I have some pretty good stories about AS too!!
Rob Dawg writes:
National City will make the BFF list soon enough but 2 weeks is enough to get together the resources for a real bank like Downey. Newport Beach is much more pleasant than Cleveland.
Rob Dawg | Homepage | 08.22.08 - 5:12 pm | #
They better freaking hurry though - either that or reschedule... Cleveland in August is great, tolerable in November - not so nice in January. Newport is fine all the time.
IMHO, unless there is a run on a bank draining its short-term liquid assets, we're not going to see a large one go under anytime soon.
Regardless of the fact that the longer some of the troubled institutions are allowed to operate, the greater the eventual cost to the FDIC.
I think the FDIC, the Fed, the Treasury and many on Wall St. continue to hope and pray that the 'credit crisis' blows over and they can go back to business as usual.
Whether then intend to run out the clock until November or whether they genuinely believe that the credit pump can be restarted is immaterial. In both cases, I believe their actions are the same: do not rock the boat any further.
Imagine if you will: the FDIC announces today that they are taking over a large troubled bank. They would risk generating a run on other large banks.
In the current environment, where many banks are potentially in trouble, it would be prudent take baby steps.
...billionaire investor Warren Buffett said he passed on an opportunity to help the troubled mortgage giant.
Oh don't worry, we'll all have a chance to help troubled Freddie.
One liners are great but I'm looking for some in depth analysis. - Moreworriedthanyou
9 times out of ten that's what everyone gets on calculated risk. IMO the reason there are so many one-liners and flip remarks is because there is nothing to analyze. The Fed and Treasury are making this up as they stumble from briar patch to frying pan. Thus all the insightful commenters are resorting to humor waiting to react to a reactionary process.
"Anyone have a good link or a good explanation of what happens if Paulson uses the 800 billion he's authorized"
Will the U.S. Treasury repudiate its obligations to its creditors, be they citizens or investors around the world? Most observers would answer "no" without hesitation. But Congress, with the complicity of the White House and the Fed, has arguably embarked on a stealth repudiation.
In his famous treatise, "The Wealth of Nations," Adam Smith noted there had never been a "single instance" of sovereign debts having been repaid once "accumulated to a certain degree." We may have reached Smith's threshold.
Anyone have a good link or a good explanation of what happens if Paulson uses the 800 billion he's authorized to bail out Fannie and Freddie?
No, because zero information has been released about what form the bail-out will take. It could involve buying common stock (unlikely), buying preferred stock, buying MBSes, making secured or unsecured loans, or simply explicitly insuring the securities. Any of these might or might not include a partial or total wipeout of the common shareholders and/or the preferred shareholders, reduction or elimination of dividends, or a haircut for the bondholders.
In short, we have nothing but guesses about what form the bail-out will take or how large it will be. Technically, we do not even know for certain that there will be one...
Rumors suggest that there is a huge fight going on in D.C. right now about these very issues. Fannie and Freddie are extraordinarily political entities.
Quite OT, but since we are waiting, this reminds of a particular malapropism of Ex-President of the Philipines - Joseph "Erap" Estrada - in this particular "eraption", the story goes that in a restaurant he kept trying to attract the attention of the waitress by beckoning her but was ignored - eventually he got pissed, went up to the manager and complained:
"I keep fingering that girl but she still won't come !"
Abigail Adams National Bancorp, Inc. (Nasdaq: AANB), a bank holding company with offices in Washington DC, Maryland and Virginia, today announced that its Board of Directors has voted to suspend regular quarterly dividends on its common stock effective immediately.
Abigail Adams National Bancorp is a two-bank holding company, majority owned and operated by women.
@Moreworriedthanyou: It is my understanding that Treasury has broad discretion wrt how to use their bazooka. Paulson has apparently hired Morgan Stanley to advise him on the options that may be available.
If we take Paulson's word, he wants to keep the structure 'as-is'. In other words, he wants to keep Fannie & Freddie operationally intact.
Some thoughts on two options:
Treasury buys preferred shares. Adds to Fannie & Freddie capital base, dilutes existing shareholders. Allows Fannie and Freddie to continue to maintain payments on their outstanding bonds and CDS contracts.
Treasury states its intention to buy into all new Fannie & Freddie securities. This is an interesting option. In this scenario, new bonds issued by Fannie and Freddie have a bid from the US Treasury. Older bonds do not.
Some combination of buying preferreds and bonds.
I think these guys know they're dealing with systemic risk here so will tread lightly with any step they take.
There are 176 people online; let's have a discussion about this failed Kansas bank. Besides, my newborn needs to feed in less than an hour, so I have a narrow blogging window before diaper time.
Wake up! The FDIC list has been updated: FDIC: Industry Analysis
individual/failed/columbian.html
Can we get a list of non-failing banks?
We will not accept failure...the show must go on.
Hedge fund Ore Hill limits redemptions
Hedge fund Ore Hill limits redemptions
| Reuters
Hedge fund Ore Hill Partners, a $3 billion credit specialist, has barred clients from getting their money back, imposing a halt on redemptions just as investors clamored for an exit, the company said on Friday.
I drove by a National City Bank in Vero Beach today that said 5.25% CD. Min $10K for 43 months. Seems like they need some cash.
Someone should hack that page and put "United States Federal Reserve Bank" at the top of the list.
It's the biggest failure of all, along with all the other fiat central banking systems around the world.
imposing a halt on redemptions just as investors clamored for an exit, the company said on Friday.
Looks like a run on hedge funds is the 2008 version of the 1929 run on banks.
MoT, with apologies to "Apollo 13":
MoT: Can we review our status here, CR? Let's look at this thing from a, uh, from a, uh, standpoint of status.
Uh, what have we got on banks that aren't failing?
CR: I'll get back to you, MoT.
Best to all.
Can we get a correlation of
failing banks to failing schools ?
Or trade deficits -v- MTV viewers ?
.
The hedge fund results that caused the run:
2005: 10.95%
2006: 13.3%
2007: 1.8%
2008: -6.5%, so far.
Easy come, easy go.
President Signs Landmark No Bank Left Behind Bill
Floor of NYSE
New York, New York
9:50 A.M. EST
THE PRESIDENT: Thank you all very much.
AUDIENCE: U-S-A! U-S-A!
THE PRESIDENT: Okay. I know you all are anxious to get back to making money. (Laughter.) So please be seated. (Laughter.) Thank you for such a warm welcome. It's great to be in the Big Apple. (Applause.)
We've got large challenges here in America. There's no greater challenge than to make sure that every bank -- and all of us on this stage mean every bank, not just a few savings & loans -- (applause) -- every single bank, regardless of where they are located, whether an investment bank or mortgage lender, the capitalization level of the bank, every financial institution receives first-class financial aid from America. (Applause.)
And as you know, we've got another challenge, and that's to protect America from evil short-sellers. And I want to assure the executives and managers at our nations financial institutions that the effort that this great country is engaged in, the effort to defend share prices and to defend bonuses, the effort to rout out downward stock prices wherever they exists, is noble and just and right, and your great SEC will prevail in this effort. (Applause.)
I long for the dollar to appreciate. But I also understand that if we do not lead the world against bank failures, that your children and your grandchildren will not grow up in a financial system as free of lending standards as the one we have today. Inflation is a precious gift that one generation can pass to the next. It is a gift and a promise that I intend to keep to the American children. (Applause.)
And we owe the children of America lots of free money. And today begins a new era, a new time in public education in our country. As of this hour, America's banks will be on a new path of reform, and a new path of results.
Our banks will have higher expectations. We believe every bank can learn. Our banks will have greater resources to help meet those goals, thanks to the Federal Reserve. Investors will have less information about the banks, and less visibility into how their banks are capitalized. From this day forward, all banks and their executives will have a better chance to learn, to excel, and to live out their dreams of being bailed out by the taxpayer! (Applause.)
Thank you for letting us come. May God bless. (Applause.)
Also, I saw a lot of houses under water for sale. The same ones I've been driving by for over a year. Now theyre literally under water.
If we can't haz bank failure/s tonight,can we at least haz snacks?
Nice Apollo 13 reference.
By the way, the ship's Captain who shakes Tom Hank's hand at the end of the movie is the real Jim Lovell.
National City will make the BFF list soon enough but 2 weeks is enough to get together the resources for a real bank like Downey. Newport Beach is much more pleasant than Cleveland.
Here's a related anecdote:
On page A15 of the LA Times, well the San Diego version at least, there's an advertisement of a bank offering a 7 month CD at 4.15%. The ad features one word in bold:
COMMITMENT
The institution offering this CD? Indymac Federal Bank.
In case anyone is concerned, the ad mentions that "Deposits Insured by the FDIC." I think they want your business back, Dawg.
Vineyard is my bet
ah yes Mr. Lovell....have had many dinner's with current and former astronauts (a perk in my capacity in a previous life) and out of all of them there are two that stand out as fine examples of true patriots (not the current definition mind you). One of them was Wally Schirra (many great stories and a shear joy to visit with-he lent me his 400i for a few hours once)and the other was Jim Lovell.
The common thread between these two is that they never drank alcohol in public. The rest of them, in comparison to these two, were just like everyone else excepting their unique experiences with regards to careers. And almost everyone single one of them I've seen drunker than skunks.
Those two would have made quite a political team IMO.
FWIW
Ciao
MS
I think they will take over FRE this weekend.
Another Fri-hi-day night and I ain't got no failures.
I got some popcorn but I'm gettin' annoyed-uh.
Oh how I wish, I had some bank to laugh at.
I need some schadenfreude.
Topher,
"Also, I saw a lot of houses under water for sale. The same ones I've been driving by for over a year."
Man you must have the coolest car to be able to drive underwater. Is it more like James Bonds Lambo from The Spy Who Loved Me, or the Mach 5?
Cheers,
We can also find comfort that the kids
will start 10-trillion in the hole,
which will keep them humble, working
at something, and free from decadent leisure.
.
MS,
Do you think the astronauts drinking problems are as a result of being on top of an extremely explosive device built by the low bidder?
The problem is we picked fighter jocks instead of RIOs, instructors and cargo pilots.
No, I think it is from Tang. Tang is a gatway drink.
Whoa, what's the Federal Reserve Bank of Atlanta doing on that list?
I got 4.91% for a 13 month CD by opening a checking account and signing up for a credit card with Wamu.
No offense to any pilots on this thread, but astronauts are pilots, and pilots, as a group, have been known to throw back a few.
peanuts make you thirsty
Nemo,
"Whoa, what's the Federal Reserve Bank of Atlanta doing on that list?"
Slumming.
Cheers,
From today's SF Chronicle columnist Leah Garchik...
Nelle Engoron found a Craigslist entry noting that the Contra Costa County Employment and Human Services Department is looking for an "organization to provide financial literacy training for laid-off individuals. ... The selected contractor(s) shall guide and support laid-off mortgage industry individuals in becoming financially literate." Laid-off workers are to be instructed on "techniques that will help them analyze their current financial situation, create a financial plan and downsize their debt."
Huh? Weren't "mortgage industry individuals" supposed to be financially literate when they were doing their jobs? Perhaps, suggests Engoron, "this helps explain how the mortgage meltdown happened."
Attention, the beatings will continue, until morale improves.
I seem to remember the last few announcements being made around 5pm PST...anyone recall?
peanuts make you thirsty
Anonymouse
Hookers say something similar.
I'm not thirsty.
words circulating around that WB is the big one to fail
It's sad, banks are only offering a bit more than their normal pittance when forced to bulk up their balance sheets. And we scramble to pick up their crumbs.
Warren Buffet won't fail, Irvine. Don't believe the hype.
Sshhhhh! CR's got a WaMu banner ad on the homepage.
And Sheila is lurking.
The party aint over till someone dances with the ugly girl (just aint enough lipstick to make this one pretty)
"Also, I saw a lot of houses under water for sale. The same ones I've been driving by for over a year. Now theyre literally under water."
Literally? Like they had flooded? Where did all this water come from?
"I seem to remember the last few announcements being made around 5pm PST...anyone recall?"
It has depended on the bank's footprint. The announcement was out shortly after 6PM EDT for First Priority (no branches west of eastern time). IMB didn't get the call until after closing time on the west coast. So, if you're hoping for a big carcass to wash up today, get a comfy chair, crack open a beer (or 3), and plan on getting comfortable until about 6 PM PDT.
An hour since the post, and still no bank failure.
You're losing your touch, CR!
"Man you must have the coolest car to be able to drive underwater. Is it more like James Bonds Lambo from The Spy Who Loved Me, or the Mach 5?"
Cheers,
Misean | Homepage | 08.22.08 - 5:23 pm | #
You are a funny one Misean. The road was dry the houses were not!
Where did all this water come from?
Anonymous
I think we have decided already that all bad things that happen are satan's mom's fault.
Please Shiela, for a change could we get Thai instead?
Looks like Wamu was just added..WOW
Just kidding
Literally? Like they had flooded? Where did all this water come from?
Her name is Fay. Orlando had to close down two water parks, because "people lose interest during inclement weather," wrote The Orlando Sentinel business section. This is one of the worst papers in the U.S.
I just saw Wachovia whistling paste a really big grave yard. He looked pretty happy.
There was this weird looking, greasy haired woman following, munching on some nasty looking pizza. Must have been Little Caesars.
Cheers,
crispy&cole writes:
Just kidding
f@%^er (j/k)
My 1 year, 5.65% Countrywide CD matures in another month. I will miss it.
What do you guys think is going to happen with LEH, WM and WB?
They all seem to be right on the edge from the rumors. Will one or two be handed over to JPM or will FDIC take them over?
Has anyone heard any more details on the 90 banks on the troubled list? I know they haven't said who is on the list, but any hints to the size or anything else on them?
Elvis writes:
No, I think it is from Tang. Tang is a gatway drink.
Yeah, but I hear those fly boys always got a lot of moontang . . . .
crispy&cole,
After that joke I recommend that you keep low for the next few days, check around when walking outside at night and make sure no-ones tampered with your brakes or engine.
lmfao!!
I know what Sheila looks like...I am on the lookout for her.
No offense to any pilots on this thread, but astronauts are pilots, and pilots, as a group, have been known to throw back a few.
Q:What's the difference between a bunch of drunks and a bunch of sluts?
A: A cockpit wall.
Once told to me by a commercial pilot.
Can you have a bank closing with all the big chiefs in Jackson Hole?
Or is that just a way to make a really big closing more efficient?
query_tool...I bought WFC XIV preffereds with a 8.65% yield a few days ago. They are going to survive this thing so I might as well put my long term cash to work.
Something to consider
If nothing happens in the next 5 minutes...then the credit crisis is over. No bank failures and the Dow goes to 15,000
if i could spell I would be dangerous...preferred
"I know what Sheila looks like...I am on the lookout for her."
I was thinking more on the lines of a couple of shifty looking white guys, crackberries in hand mumbling about their puts/calls.
"If nothing happens in the next 5 minutes...then the credit crisis is over. No bank failures and the Dow goes to 15,000"
Is that you Sebastian or O-Joe. Stop masquerading as c&c.
are you kidding me! writes:
They are going to survive this thing so I might as well put my long term cash to work.
Just like Poland survived WWII. Lots 'a luck.
Everything is now contained...time to go LONG
"Everything is now contained...time to go LONG"
If you believe that then I suggest you make sure to hold on tight to that bar of soap when you're in the bathroom. DON'T drop it, and if you do, DO NOT bend over to pick it up.
If I could cast spells I'd be dangerouser.
WM closed at 3.83. I'm actually leaning that way. So it will be after 6PM pst.
Cheers,
lmfao!!!
I'd guess that somethings as messy as a WaMu, Wachovia, or even a DSl would require extra time and extra pizza. Labor Day weekend is coming, but not today...
Downey is PST as well. Fortunately by then I'll already be dining at the Hollywood Bowl. Tonight's concert is strange, Donna Summer. Seems like everything I'm doing these days involves revisiting the past. Anybody got any "W.I.N." buttons?
Given what we know about the current Admin (case in point: latest Medicare fraud claims mendacity), there must be strong internal incentives to push as much of this past November as possible.
So I keep wondering, baring an outright run on a bank, how long CAN an FDIC takeover be put off. FFDIC?
Rob Dawg,
Whip Inflation Now 3.5" Button - CafePress
There ya go.
Cheers,
$4.99!?! For a whip inflation now button?! Sh¡t, I guess it didn't work the first time. Thanks for the link and laughs all day.
"Given what we know about the current Admin (case in point: latest Medicare fraud claims mendacity), there must be strong internal incentives to push as much of this past November as possible."
Quite true. And maybe they're thinking that there's a REALLY conveniently placed 4-day weekend toward the end of November. Granted, Thanksgiving Friday is neither a bank nor a trading holiday, but someone has to give Domino's something to do that weekend, right? And most of America will be too busy recovering from tryptophan comas and participating in the annual orgy of mall-ness to notice.
Dawg, you can make 10 of them for 19.99. Then just put them up for sale for 2.10 and you'll have it for free.
jus sayi
What am I offered for "Whip the Fed Now" buttons? [ I'm thinking real whips. ]
oh, dear, we've just unleashed a monster.
No W.I.N. button but I've got a 'moral equivelent of war' button.
MEOW.
Cocktail hours. Later to you.
"Do you think the astronauts drinking problems are as a result of being on top of an extremely explosive device built by the low bidder?"
Absolutely......although no one knew more about the Atlas rocket than Wally. That includes every single person responsible for design, mfg.,maintenance, safety (oxymoron in those days)
But I also (as he told me later in his life) realize that it was only a few times and you can't spend your life compensating for an event that you did survive. He was speaking about one of his former colleagues....his initials were A.S. since I'm not wanting to name actual names and all......
And I have some pretty good stories about AS too!!
Ciao
MS
<a href="http://buttons.cafepress.com/item/ross-perot-08-35-button-10-pack/229110614>???
Buffett not Buffet...
Rob Dawg writes:
National City will make the BFF list soon enough but 2 weeks is enough to get together the resources for a real bank like Downey. Newport Beach is much more pleasant than Cleveland.
Rob Dawg | Homepage | 08.22.08 - 5:12 pm | #
They better freaking hurry though - either that or reschedule... Cleveland in August is great, tolerable in November - not so nice in January. Newport is fine all the time.
Timing is everything.
IMHO, unless there is a run on a bank draining its short-term liquid assets, we're not going to see a large one go under anytime soon.
Regardless of the fact that the longer some of the troubled institutions are allowed to operate, the greater the eventual cost to the FDIC.
I think the FDIC, the Fed, the Treasury and many on Wall St. continue to hope and pray that the 'credit crisis' blows over and they can go back to business as usual.
Whether then intend to run out the clock until November or whether they genuinely believe that the credit pump can be restarted is immaterial. In both cases, I believe their actions are the same: do not rock the boat any further.
Imagine if you will: the FDIC announces today that they are taking over a large troubled bank. They would risk generating a run on other large banks.
In the current environment, where many banks are potentially in trouble, it would be prudent take baby steps.
Anyone have a good link or a good explanation of what happens if Paulson uses the 800 billion he's authorized to bail out Fannie and Freddie?
One liners are great but I'm looking for some in depth analysis.
Why the hell did BW's editorial board pass on this title???
"Freddie got fingered (by Buffett)"
"Freddie Mac courts investors, Buffett passes"
Business Week Online > File Not Found
...billionaire investor Warren Buffett said he passed on an opportunity to help the troubled mortgage giant.
Oh don't worry, we'll all have a chance to help troubled Freddie.
It's 4:00PM Pacific Standard Time Friaday. Do you know if your bank is solvent?
Premature Thread Music
YouTube - Curtis Mayfield ~ Freddies Dead
"But...I'm not dead yet!"
Thwack!
One liners are great but I'm looking for some in depth analysis. - Moreworriedthanyou
9 times out of ten that's what everyone gets on calculated risk. IMO the reason there are so many one-liners and flip remarks is because there is nothing to analyze. The Fed and Treasury are making this up as they stumble from briar patch to frying pan. Thus all the insightful commenters are resorting to humor waiting to react to a reactionary process.
Article:
Is the Fed Still a Central Bank?
Peter Morici: Is the Fed Still a Central Bank?
Maybe it's a new kind of central bank....
"Anyone have a good link or a good explanation of what happens if Paulson uses the 800 billion he's authorized"
Will the U.S. Treasury repudiate its obligations to its creditors, be they citizens or investors around the world? Most observers would answer "no" without hesitation. But Congress, with the complicity of the White House and the Fed, has arguably embarked on a stealth repudiation.
In his famous treatise, "The Wealth of Nations," Adam Smith noted there had never been a "single instance" of sovereign debts having been repaid once "accumulated to a certain degree." We may have reached Smith's threshold.
Washington Is Quietly Repudiating Its Debts - WSJ.com
Yeah and you can bank on it with a pretty low risks of not being correct, add about trillion for SS and Medicare and I think it's a slam dunk.
Moreworriedthanyou --
Anyone have a good link or a good explanation of what happens if Paulson uses the 800 billion he's authorized to bail out Fannie and Freddie?
No, because zero information has been released about what form the bail-out will take. It could involve buying common stock (unlikely), buying preferred stock, buying MBSes, making secured or unsecured loans, or simply explicitly insuring the securities. Any of these might or might not include a partial or total wipeout of the common shareholders and/or the preferred shareholders, reduction or elimination of dividends, or a haircut for the bondholders.
In short, we have nothing but guesses about what form the bail-out will take or how large it will be. Technically, we do not even know for certain that there will be one...
Rumors suggest that there is a huge fight going on in D.C. right now about these very issues. Fannie and Freddie are extraordinarily political entities.
"Freddie got fingered (by Buffett)"
CanuckBuck
Quite OT, but since we are waiting, this reminds of a particular malapropism of Ex-President of the Philipines - Joseph "Erap" Estrada - in this particular "eraption", the story goes that in a restaurant he kept trying to attract the attention of the waitress by beckoning her but was ignored - eventually he got pissed, went up to the manager and complained:
"I keep fingering that girl but she still won't come !"
-K
Thank you anonymous. I feel the bluff has been called and our fears are becoming reality.
Abigail Adams National Bancorp, Inc. (Nasdaq: AANB), a bank holding company with offices in Washington DC, Maryland and Virginia, today announced that its Board of Directors has voted to suspend regular quarterly dividends on its common stock effective immediately.
Abigail Adams National Bancorp is a two-bank holding company, majority owned and operated by women.
Abigail Adams National Bancorp, Inc. Announces Suspension of Quarterly Dividends
Bunch of heifers.
"The Columbian Bank and Trust, Topeka, KS"
Got Coke ?
Check again, folks! We've got a failure in Kansas!
Another pudunk. Still early. Where's the MEAT? We want a WHOPPER!
@Moreworriedthanyou: It is my understanding that Treasury has broad discretion wrt how to use their bazooka. Paulson has apparently hired Morgan Stanley to advise him on the options that may be available.
If we take Paulson's word, he wants to keep the structure 'as-is'. In other words, he wants to keep Fannie & Freddie operationally intact.
Some thoughts on two options:
I think these guys know they're dealing with systemic risk here so will tread lightly with any step they take.
Bank failures is now up on next thread.
Will we go for two today?
Best to all.
Failure in Topeka, KS.
press release here
The institution offering this CD? Indymac Federal Bank.
In case anyone is concerned, the ad mentions that "Deposits Insured by the FDIC." I think they want your business back, Dawg.
Which leads to a fascinating question ...
Has a bank, owned & operated by the FDIC, ever been closed be the OTS (after FDIC was designated as receiver that is) ?
Makes for an interesting scenario doesn't it.
How's the pizza in Topeka? Wonder if there are any Toy Stores to use as a clever cover for the covert operation?
The Columbian Bank and Trust, Topeka, KS
Small bank.
Scary for the 3 and 4 day holidays!
Got Popcorn?
Neil
There are 176 people online; let's have a discussion about this failed Kansas bank. Besides, my newborn needs to feed in less than an hour, so I have a narrow blogging window before diaper time.
Wake up! The FDIC list has been updated:
FDIC: Industry Analysis
individual/failed/columbian.html
Got Popcorn?
Neil
Oops, Mr. Beach beat me to it.
Kansas?
What the heck happened in Kansas?
Anyone have an autopsy on this one?